Walmart Inc decides to make Flipkart public: 25% of shares estimated at $10 billion

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  • Walmart hires Goldman Sachs to analyze initial share values.
  • 25% of shares estimated to value $10 billion.
  • Walmart holds 82% stake in Flipkart.

Flipkart, an Indian e-commerce firm, based out of Bengaluru that was taken under the wing of Walmart Inc back in 2018, will be working on its IPO, as the American multinational retail corporation that owns the company decided to sell an estimated 25% of its shares.

Walmart Inc has hired Goldman Sachs to analyze the initial share values of the US unit of Flipkart for around $10 billion.

How E-commerce platforms saw a surge in the business amidst the pandemic

Since the beginning of the pandemic, people have shifted to online retail platforms for their needs, due to social distancing norms and for safety concerns.

The surge in the traffic from urban and even small towns to these e-commerce companies, especially in India, will be a major advantage to the Walmart organization’s plans to make Flipkart public at this time.

Flipkart is a major competitor to Amazon in India and other growing e-commerce providers like JioMart, Alibaba in India and more.

Walmart’s stakes in Flipkart

If Flipkart valuations and IPO becomes successful, it will be the largest for an Indian-based organization on an overseas exchange and the valuation of the e-commerce platform is estimated to increase to $40 billion. Currently the company is valued at $24.9 billion, back in July with Walmart as the lead investor.

Back in 2018, Walmart had acquired a 77% stake, which has increased to 82% in the last funding round, other investors are Tencent, Accel Partners, Microsoft Corporation and Tiger Management.

As Flipkart plans for IPO, it is expected to create favourable circumstances for small level investors to manage their shares, proceedings from which might be used towards expansion of the business, especially as e-commerce businesses are seeing a boom in operations.

Flipkart not only saw a large number of new customers, but also planned and worked introducing new languages in the platform, and on expanding its delivery services across several new regions in the country.

Will Flipkart’s PhonePe be going public in 2023

Flipkart also decided to spin-off PhonePe, while still remaining a majority shareholder even though it might lose its ownership status to raise capital for the expanding and exploring the market of digital payments methods in the country. Following this PhonePe will also be going public in 2023, a major competitor to payment companies like Google Pay, Paytm and Amazon Pay.

Walmart recently reported that both Flipkart’s and PhonePe India’s active number of users per month increased consistently and reached its all-time high, amidst the pandemic.

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